Mechanism Analysis And Empirical Study Of Impact Of Fair Value To The Enterprise Value

Since1990s, the fair value, as a new measurement method, has attracted more and more international wide-ranging discussions. Since then, both the International Accounting Standards Board (IASB) and the Financial Accounting Standards Board (FASB), by promulgation of a series of accounting standards, had promoted the application and development of fair value. In order to strengthen the coordination and convergence of our accounting standards and International Financial Reporting Standards (IFR), a fair value measurement model had been introduced in. The extensive use of fair value, whether in accounting theory or practical community, has caused intensive controversy. However, the research on fair value accounting in China is mainly based on the criterion, the introduction of fair value accounting standards, assessment and relevant background theory and practical Application of the normative text abroad.Based on the above background and referring to the relative fruits home and abroad, first, the impact of the fair value on the enterprise value is analyzed theoretically. Then, taking Shanghai and Shenzhen A-share companies in 2007-2008 as a sample, A empirically test is performed to find whether and how gains and losses and the equity resulting from changes in fair value affected the enterprise value. The theoretical analysis shows that: the fair value accounting, as a measurement searching for a major change, has brought great impact on enterprise value and increased fluctuations in the enterprise value distinctly; Empirical test also indicated that: excluding fair value changes, earnings per share and per share net asset of the impact on the enterprise value will be weaken; the impact of fair value changes in profit and loss on the enterprise value are significantly higher than the net change of fair value of financial assets available for sale of the capital reserve. Therefore, the concept of comprehensive income as well as the suggestion on making a comprehensive income statement (with fair value) and a separate income statement (excluding fair value) were proposed.The dissertation is divided into three parts. Some of the conclusions and contribution of this paper are listed as follows.①A brief description of the development process and current application for the fair value is given. Based on this basis of enterprise value, some of the basic theories are discussed deeply, and the business value of the most appropriate Tobin's Q is proposed.②Theoretically explanation on the impact mechanism of fair value to the enterprise value is presented. Also the assumption saying"changes in fair value intensifies fluctuations in the enterprise value; Compared with the changes on rights and interests resulting from the changes in fair value , the impact of the loss changes to the enterprise value is more significant"is proposed.③Starting from demonstrations,the two hypotheses mentioned above have been validated, the concept of comprehensive income as well as the suggestion on making a comprehensive income statement (with fair value) and a separate income statement (excluding fair value) were proposed.